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Friday Sep 13, 2019   
Earlier this week I spent a few days at the annual NIPPC conference at the Alderbrook Lodge located on the beautiful Hood Canal near Washington’s Olympic Mountains. NIPPC stands for “Northwest and Intermountain Power Producers Coalition – a trade association whose membership is primarily comprised of a handful of merchant natural gas generators, wind owners, and renewable project developers. Before diving into some of the conference highlights, I want to mention NIPPC’s long-time executive director, Bob Kahn, who passed away in August after a brief and intense battle with non Hodgkins lymphoma. Bob’s vision and leadership have contributed immensely to the policy debates in Northwest energy circles. He was a strong voice for competitive markets and understood ... » read more
Thursday Sep 12, 2019   
New England has been dependent on gas generation to supply a majority of its electrical needs for a long time. The region relies on the Algonquin Pipeline to supply cheap natural gas to facilities in the region, but this lifeline has continued to be subject to capacity constraints with prices skyrocketing when it binds. However, the grid has decided it is time for a change. The latest state of the grid presentation reported that the ISO will continue to try and shift away from natural gas generation towards renewables with an emphasis on distributed supply. Figure 1, taken from the state of the grid presentation, shows how the market expects this to play out. Figure 1 | Shifting Resources from State of the Grid ISONE While Figure 1 displays two changes happening simultaneously, both of ... » read more
Wednesday Sep 11, 2019   
Now that we are getting deeper into the month of September, it is time to put an end to the current water year in the West, one of which saw the Pacific Northwest have some massive swings when it comes to the overall snowpack in the mountains and where it was actually located.  This not that uncommon as the region is quite large and depending on the jet stream pattern and how Mother Nature wants to sprinkle some cooler weather on specific basins helps determine how the water year shakes out.  Down in California, there was a time where the water was so scarce that the irrigation rights were in debate over the operations of the dams producing power.  In 2017, such debates were pushed to the side as the state saw record precipitation (in the form of snow and plenty of ... » read more
Tuesday Sep 10, 2019   
The James River corridor is the critical supply path from British Columbia into the Alberta gas distribution system. That path has been under maintenance for most of the summer causing the production contribution into the NGTL system to fall from 11 to 10.2 BCF per day. Nova has now extended the outages through the end of the injection season. After November 1 the rating on the corridor will increase to 11.7 BCF which should provide ample supply for the winter. The problem is that because of the ongoing restrictions, the NGTL system has not been able to inject into storage. The caverns are now at a 74 BCF deficit to last year.    Figure 1 | Alberta Natural Gas Storage inventory The current in ground supply stands at 255 BCF which is a 75 BCF deficit to last year. This is ... » read more
Monday Sep 9, 2019   
The first full week of September 2019 was full of excitement in the West as temperatures in Southern California hit the summer highs (on average) while the Desert Southwest saw a couple of unplanned outage change its thermal supply stack.  When you throw in the fact that California has some transmission constraints that locked down the overall capacity that could flow north to south on Path 15 and SoCal Gas was experiencing maintenance work at Topack, we had ourselves a mini-perfect storm.  In fact, the power supply stack marginal megawatt was shifting too the right and crossing over several inflection points to warrant some the highest prices we have seen all summer. Now the $78.91 day-ahead high print was prompted by the previous day's uptick to $91.14 with a high water mark ... » read more
Friday Sep 6, 2019   
Waiting for regionalization of energy markets sometimes feels like waiting for an earthquake.  You’re told that the big change is coming—just around the corner--only to have years go by where nothing appears to happen.   Occasionally there is a tremor, like when earlier proposals RTOs were made--and then withdrawn--or when California considered for a hot minute about sharing control of its ISO with its western neighbors.     But, maybe, regionalization in the west is more like watching the tide come in: harder to discern but apparent over time via a series of incremental waves.  The Western Energy Imbalance Market (EIM) has now been operating for five years and participation has increased every year.  Progress may not be inexorable, but ... » read more
Thursday Sep 5, 2019   
If you have been following the wave of nuclear bailouts catching on throughout the Northeast, the latest bill to be passed was a subsidy in Ohio. The legislation is intended to keep the Davis-Besse and Perry nuclear facilities on the grid. While first presented as a way to reduce carbon emissions, the bill later tacked on subsidies for First Energy coal facilities.  By tacking on the coal subsidies, it is hard to accept that the carbon emission reduction theme is true to their hear as the retirement of the coal units would be more in-line.  The one organization that stepped to the opposition plate was the Ohioans Against Corporate Bailouts (OACB) as their motto in in the name and speaks for itself. The most recent development tied to the battle of subsidies vs. a more green ... » read more
Wednesday Sep 4, 2019   
Over the past week and a half, there has been a lot of attention to what is now known as Hurricane Dorian as it is dropping plenty of rain and high winds on the Florida Atlantic coast before making its way up into the Caolinas by the weekend.  Prior to all this, the storm seemed to be at a stand still over the Bahamas as a Category 5 hurricane.  This type of action is almost unheard of as the momentum of the storm did not die down but the path it was taking did.  As a result, this did not bode well for the island as 180 mile per hour winds and rain wreaked havoc on everything and everybody as it was like a drill boring a hole in a wall or a floor joist  and all you see is remnants from the wood making its way to the outer layer. Figure 1 | Hurricane Dorian ... » read more
Tuesday Sep 3, 2019   
Dorian started popping up on the models early last week as it moved largely undeveloped through the middle of the Atlantic Ocean. Almost every model had this storm moving over Puerto Rico and then onto the Florida Straits where it would gain steam before moving into the Gulf of Mexico. Each model run prior to Wednesday was reaffirming a threat to the Gulf production complex. But then the storm made a very unlikely right hand turn. By avoiding the Dominican Republic and staying over the warm waters near the Bahamas, Dorian quickly gained steam posting speeds over 200 MPH. The track had also shifted to a Central Florida landfall. This still kept Gulf production at risk as memories of Hurricane Frances were recalled. Figure 1 | TS Dorian Path as of August 26   But as the Upper ... » read more
Friday Aug 30, 2019   
The Labor Day weekend is upon us which means the month of August is coming to an end and the homework will start to pile up as the summer lounging days will be in the past as school is in play.  On the electricity front, this means that the weather patterns are looking to change to more fall-like temperatures as we get deeper into the month.  Before we travel down that road, I thought it would be good to give you, the reader, some insight to the last few Newsletter articles and monthly reports published by EnergyGPS.  If you would like to receive such reports on a forward basis, you can do so by signing up for our Gold or Platinum packages we offer.  For more information, click here for more detail.  It should be noted you can click on the report link itself ... » read more
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